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Employment and Fertility Choice: A Differential Game Approach

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Author Info
Joao Ricardo Faria () (University of Texas Pan American)
Le Wang () (University of Minnesota)

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Abstract

For OECD countries there is an intriguing variety of combinations between total fertility rate (TFR) and female labor force participation rate (FPR) suggesting the existence of multiple equilibria. This paper provides a differential game framework where the employment choices by husband and wife affect a family’s fertility. The model has multiple open-loop equilibria characterized by different combinations of FPR and TFR that are consistent with the empirical cross-country evidence. The dynamic trajectory from one equilibrium point to another also sheds lights on possible demographic transition of individual countries as displayed in their time series data. The model stresses that the husband’s employment decisions are as important as wife’s in determining family size.

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File URL: http://economicsbulletin.vanderbilt.edu/2007/volume10/EB-07J00004A.pdf
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Publisher Info
Article provided by Economics Bulletin in its journal Economics Bulletin.

Volume (Year): 10 (2007)
Issue (Month): 9 ()
Pages: 1-8
Download reference. The following formats are available: HTML, plain text, BibTeX, RIS (EndNote), ReDIF
Handle: RePEc:ebl:ecbull:v:10:y:2007:i:9:p:1-8

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Related research
Keywords: Fertility Female participation

Find related papers by JEL classification:
J0 - Labor and Demographic Economics - - General
C7 - Mathematical and Quantitative Methods - - Game Theory and Bargaining Theory

References listed on IDEAS
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  1. Daniela Del Boca, 2002. "The effect of child care and part time opportunities on participation and fertility decisions in Italy," Journal of Population Economics, Springer, vol. 15(3), pages 549-573. [Downloadable!] (restricted)
    Other versions:
  2. George A. Akerlof & Rachel E. Kranton, 2000. "Economics And Identity," The Quarterly Journal of Economics, MIT Press, vol. 115(3), pages 715-753, August. [Downloadable!] (restricted)
  3. Chen, Zhiqi & Woolley, Frances, 2001. "A Cournot-Nash Model of Family Decision Making," Economic Journal, Royal Economic Society, vol. 111(474), pages 722-48, October. [Downloadable!] (restricted)
    Other versions:
  4. Alberto Bisin & Giorgio Topa, 2003. "Empirical Models of Cultural Transmission," Journal of the European Economic Association, MIT Press, vol. 1(2-3), pages 363-375, 04/05. [Downloadable!] (restricted)
  5. Feichtinger, Gustav & Wirl, Franz, 1993. "A Dynamic Variant of the Battle of the Sexes," International Journal of Game Theory, Springer, vol. 22(4), pages 359-80.
  6. Ashenfelter, Orley & Heckman, James J, 1974. "The Estimation of Income and Substitution Effects in a Model of Family Labor Supply," Econometrica, Econometric Society, vol. 42(1), pages 73-85, January. [Downloadable!] (restricted)
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  7. Pedro Mira & Namkee Ahn, 2002. "A note on the changing relationship between fertility and female employment rates in developed countries," Journal of Population Economics, Springer, vol. 15(4), pages 667-682. [Downloadable!] (restricted)
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  8. Lundberg, Shelly & Pollak, Robert A, 1996. "Bargaining and Distribution in Marriage," Journal of Economic Perspectives, American Economic Association, vol. 10(4), pages 139-58, Fall. [Downloadable!] (restricted)
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This page was last updated on 2008-9-25.

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